Siyabonga Hadebe | Saturday, 29. June 2024
Following the ANC’s underwhelming election performance, South Africa is currently embroiled in a gruesome process of coalition-building. Although this is not necessarily a new problem as it is often portrayed, there was ample time to develop rules and guidelines seeing huge problems coalition created at the local government level. However, the primary concern now is how political parties are approaching the task of forging working relationships, whether they term them as coalitions or as a ‘government of national unity’ (GNU).
In interpreting the election outcome, the ANC asserts that the results indicate a desire among South Africans for political parties to collaborate in addressing critical national challenges and enhancing the welfare of the populace. With its majority vote, the ANC has opted for a GNU as the most suitable approach in the national interest and has initiated discussions with all parliamentary parties to form this GNU. To date, as many as ten parties have joined the GNU arrangement, with the ANC and the DA as main protagonists.
Notwithstanding the enthusiasm, people have not directed any political parties to work together but the elections did not present an outright winner. The law stipulates that a simple majority or 50% plus one of the members of the National Assembly is required to form a government. Strangely, the ANC appears to have created a non-existent rule that says since it is a party “that received the most votes” should decide on the type of government that must be formed. In short, no legal provision empowers a minority party, irrespective of the percentage obtained, to decide anything.
The correct interpretation of the election outcome is that there was no winner and that is as far as the people have spoken. In the absence of rules and guidelines for coalitions, the ANC-DA behaviour has been unbecoming as seen in their unholy cooperation. In their operation teka hinkwaswo (take all), the two parties did not allow a party “that received the most votes” to form a government in KZN. They have also dominated the coalition discourse to the exclusion of other parties, such as the MK and EFF.
- Ills of GNUeering: The widening gap between People and Power
What has become clear throughout the GNUeering process is the glaring, wide gap between PEOPLE and POWER. Put simply, this signifies a disconnect or imbalance in the relationship between the governed and their governors within a political system. The gap encapsulates the various political challenges it poses to democratic governance and social cohesion. This allows politicians and others to abuse authority and manipulate processes to undermine the people’s voices.
Christian Kreuder‑Sonnen and Berthold Rittberger believe that this gap is “an endogenous source of polity contestation.” In their view, this gap creates internal tensions and conflicts within the political system itself, leading to contestation or competition over political authority, resources or policies. The squabbling over coalitions is currently taking does not involve the people, but only politicians and political parties. This simply explains how easy it is for anyone to manipulate liberal democracies.
Of course, not every politicking individual sees through what is going on as the distance between people and those in power steadily grows. This is unsurprising as the recent survey by the Pew Research Centre shows that a significant number of people in many countries are open to non-democratic alternatives to their current government. Thirty-one per cent of people across twenty-four countries surveyed, including South Africa, said an authoritarian system with a strong leader or military rule would be a good way to run their country. This explains the deafening silence as the DA and ANC slug it out.
Behaving like rival siblings fighting over the last piece of cake at a birthday party, the DA and ANC are embroiled in bitter quarrels over the spoils of governance. The aftermath of the election has revealed a landscape rife with power struggles and opportunistic manoeuvres, where these two dominant parties, are now engaged in a tug-of-war for control and influence. Their behaviour mirrors that of playground bullies vying for supremacy, disregarding the electorate’s desire for effective governance that will help to address inequalities in South Africa.
Even more concerning, the absence of a clear winner in the election has exacerbated tensions, with both parties laying claim to their interpretation of the people’s will, all the while neglecting the broader spectrum of political diversity that exists beyond their agendas and immediate needs. At the centre of this squabbling is to see who can come out top in controlling politics and resources, taking advantage of an indeterminate outcome.
In this struggle for dominance, the ANC’s insistence on a GNU under its terms reflects a desperate bid to maintain authority, while the DA’s resistance highlights its determination to assert its vision, even at the cost of building a state that will serve everyone equally. This power play not only undermines democratic principles but also deepens the chasm between politicians and the populace they are meant to serve. This phenomenon will intensify over time as the political system’s credibility is questioned.
Logic suggests that those who believe democratic values are less important are also more likely to support authoritarian systems. Interestingly, the Pew Research Centre survey found that very few people who support authoritarianism said they want to completely overthrow their democracy. Instead, they want changes within the system, with a focus on economic issues or new leadership in some countries.
But is this possible when the gap between PEOPLE and POWER is quickly resembling the ugly divorce between the Somali and Nubian Plates?
- The race for the cookie jar: Who will control the Public Investment Corporation?
Complicating the picture even more are practical concerns over who, between the DA and ANC, will be the first to lay their hands on the funds controlled by the Public Investment Corporation (PIC). The PIC is a significant entity responsible for managing public funds and investments, specifically the monies held by the Government Employees Pension Fund (89.43%) on behalf of public servants, as well as a small portion of the Unemployment Insurance Fund (4.64%) and Compensation Fund (2.05%).
People like former finance minister Trevor Manuel gave themselves unchallengeable powers over this public entity. He was not only the sole shareholder representative on behalf of the government but also chaired the board of the PIC. Today, the minister of finance appoints the board in consultation with the cabinet. This board reports directly to the minister as the sole government representative.
While this has been the tradition, some argue it grants excessive political influence over the PIC. Both the ANC and DA are vying for this space in full swing: the former wants to control the ministerial role, while the DA demands the deputy position.
Nonetheless, the PIC plays a critical role in the South African economy, acting as a giant investor managing vast public sector funds. As Africa’s largest asset manager, the PIC holds significant sway over the JSE. It controls over 10% of the JSE’s market capitalisation, meaning its investment decisions directly impact the value of many South African companies.
This influence, however, extends beyond stock prices. Ideally, the PIC’s strategic investments in key sectors should promote economic growth and development in targeted areas. Grounded in antiquated neo-liberal economic principles, the PIC’s approach has not done enough to transform the economy. Furthermore, the secrecy surrounding the PIC’s portfolio, particularly the split between listed corporations and unlisted ventures, makes it difficult to assess the fund manager’s impact on transformation. Investments geared towards empowering black businesses and small players remain a contentious issue.
Historically, the PIC has heavily favoured listed equities on the JSE, which is home to many large South African companies. However, recent years have witnessed a shift, with the PIC increasingly venturing into the realm of unlisted investments. While the percentage of unlisted investments remains smaller, it is steadily on the rise. With conservatism dominating the economic policies of both the DA and ANC, these parties are unlikely to turn South Africa into an ‘entrepreneurial state’ through the PIC.
The PIC, GEPF and state development finance institutions generally show what may be regarded as a lack of faith in the South African economy in preference for overseas markets. In the name of “diversification” and attracting capital, these institutions generally have no footprint in black areas to stimulate the real economy. This is not surprising since the PIC has not played an active role in facilitating transformation in the country’s asset management industry.
Furthermore, the PIC’s core function is to ensure the long-term financial security of public sector employees. By managing funds for public servants, it should directly impact the well-being of millions of South Africans. However, this is not the case since many public servants constitute a large portion of what the International Labour Organisation (ILO) categorises as the ‘working poor’, denoting “people who live in households that fall below an accepted poverty line.”
Unfortunately for these mainly black workers, trade unions have also been actively mimicking capitalists through their highly controversial investment houses over the last thirty years. This implies there has been no one speaking on their behalf as poverty takes its toll. As usual, the ANC has not followed up on its 2019 manifesto to investigate prescribed assets on financial institutions’ funds for social and economic development, and to mobilise funds for socially productive investments like housing and infrastructure.
Control of funds managed by entities like the PIC, GEPF, UIF and DFIs must be subject to democratic processes regarding how they are invested and utilised. This must be guided by a deliberate and conscious ideology of building an entrepreneurial state. The ongoing fiscal battles, sadly, reflect not just economic priorities but also the ethical dimensions of political decision-making in a country grappling with inequality and social justice issues.
This opens up the gap between the people and power due to the lack of involvement by mainly black workers in decisions concerning their pension funds and other contributions. Mismanagement or manipulation of these funds exacerbates existing disparities, undermining public trust in state institutions. The GNUeers should understand that the deeper the divide between the people and decision-making, the greater the potential disaster for everyone.
As for the people and workers, they must stand up before the wells run dry.
Siya yi banga le economy!
Jaywalking Political Discussions 